1. Field of the Invention
The present invention relates generally to methods for validating transactions, and more specifically the present invention is directed toward a dynamic method for credit authentication.
2. Related Art
Credit card, calling card, and bank card fraud cost businesses (and consumers) millions of dollars annually. Current security mechanisms are not fail-safe, and protection mechanisms for consumers and businesses require improvement to stem these fraud-related losses.
Today, the validation of credit transactions is ineffective to deter persons intent on committing fraud. For example, anyone with a credit card number and expiration date can charge to the account when ordering by phone or by computer dial-up. This problem is further exacerbated by the ease with which credit card numbers can be obtained. One need simply sift through the trash for discarded statements, receipts, and carbons to obtain valid credit card numbers.
Calling card transactions exhibit similar problems. For example, calling card numbers are routinely "surfed" at airports by people watching over the shoulders of card users as they key in the calling card number. Thereafter, the calling card number is distributed and rampant fraud results.
One conventional method for combating fraud has been the provision of static personal identification numbers (PINs). Typically, these PINs are defined by the user to reflect personal information (e.g., birth date, anniversary date, etc.). While the personalization of these PINs aids the user in remembering these numbers, it also aids a person in guessing the PINs. This security risk increases when users define the same PINs for multiple cards.